Dubai World sells West End office in one of London's largest property deals

The overseas investment arm of Dubai World has sold Grand Buildings, the
landmark Victorian office property in London's West End.

The building, at One Trafalgar Square, was sold by Istithmar to an unnamed Russian investor for £172m and is one of the largest investment deals in London's West End to be carried out. It is thought to be the Russian's first purchase in the UK market.

Grand Buildings

Grand Buildings includes retail outlets and office space, which is let to Enterprise Oil. The property was constructed in the 1870s and is understood to have been purchased by Istithmar for about £155m five years ago.

Istithmar sold two properties in the capital in November for £10m and a share of future profits to Great Portland Estates.

London properties are likely to be near the top of any list of assets to be sold by Dubai World, which ran into difficulties last year. It has asked for a "stand-still" agreement on large chunks of its $60bn debt pile.

In May Dubai World, which owns Dubai Ports the owners of P&O, agreed the terms with a co-ordinating committee of seven leading creditor banks, chaired by the Royal Bank of Scotland. The banks on the committee hold about 60pc of the company's debt. The rest of the debt is owned by 73 banks. The consortium of lenders said it hopes to have an agreement in place on repayments by the autumn.

The creditors were also told that Dubai World would seek to sell assets to finance the payments. However, the company insisted that the terms of the restructuring would mean that it could wait to sell assets at the best time rather than start a fire-sale.

The process of selling assets has already started with the potential offloading of Inchcape Shipping Services, a port and shipping agent.